THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[18:00:01]

WOLF BLITZER, CNN ANCHOR: We're standing by to hear from him this hour. And we will talk to a key Trump supporter.

Razor-thin. Hillary Clinton beats Bernie Sanders in Iowa by the smallest margin ever, but the Vermont senator holds a considerable advantage as the battle moves to New Hampshire. The primary there only seven days away, can Clinton come from behind?

Countering Putin, the U.S. sending a clear signal to the Russian President Vladimir Putin, announcing plans to significantly increase Western military might in Eastern Europe, more American troops, more American weapons on Russia's doorstep. Is it the start of a new Cold War?

We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

ANNOUNCER: This is CNN breaking news.

BLITZER: We're following the breaking political news in New Hampshire, where we're standing by to hear from Donald Trump this hour. We just landed in Manchester for his event that's about to get under way fresh from his disappointing second-place finish in Iowa. Up next, the nation's first primary one week from today, and a win is critical for Donald Trump.

Senator Ted Cruz now the man to beat in New Hampshire after a solid win over Trump in the Iowa caucuses. And Marco Rubio riding his momentum into New Hampshire, he did a lot better than expected in Iowa, coming in third, just barely behind Donald Trump. And, tonight, he's drawing new attacks from his GOP rivals.

We're covering all of that, much more this hour, with our correspondents, our expert analysts, and our guests. They're all standing by.

Let's get straight to New Hampshire right now.

CNN political reporter Sara Murray is on the ground for us.

Sara, Donald Trump also there tonight and we're going to be hearing from him soon. What's the latest? SARA MURRAY, CNN NATIONAL POLITICAL CORRESPONDENT: That's right,

Wolf.

And New Hampshire could be a friendlier state to Donald Trump. He's preparing to hold a big rally here tonight after a pretty gracious concession speech last night. But if you thought that was going to last, you better forget it because he is coming back out swinging today.

(BEGIN VIDEOTAPE)

MURRAY (voice-over): After a humble concession speech in Iowa.

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: I was told by everybody, do not go to Iowa. We finished second. And I want to tell you something, I'm just honored.

MURRAY: Donald Trump is back on the warpath, taking to Twitter to slam the media coverage of his loss to Ted Cruz, grumbled that voters don't appreciate that he's self-funding his campaign and take a swipe at Ted Cruz, tweeting: "Anybody who watched all of Ted Cruz's far too long, rambling, overly flamboyant speech last night would say this was his Howard Dean moment," a reference to the Dean scream that was the final blow to Howard Dean's 2004 presidential campaign.

As promised, Trump heads to the Granite State.

TRUMP: We'll be in New Hampshire, and that will be something special. It's going to be a great week.

MURRAY: Where he's hoping to regain his footing and leads his closest competitor by more than 2-1 margin in the latest CNN/WMUR poll, all while that competitor, Ted Cruz, enjoys his victory lap.

SEN. TED CRUZ (R-TX), PRESIDENTIAL CANDIDATE: So what a victory last night.

MURRAY: Today, the Texas senator is campaigning in both New Hampshire and South Carolina, and tearing into Trump as he tries to turn his victory into a winning streak.

CRUZ: Donald Trump was saying every day that I was his friend, that he loved me, that I was terrific, that I was nice. And now I'm an anchor baby.

MURRAY: With just seven days until the primaries, a crowded field is quickly turning vicious.

CRUZ: Marco made the decision, the conscious, deliberate decision to go and stand with Barack Obama and Chuck Schumer and Harry Reid and to lead the fight for amnesty.

MURRAY: But, today, he's a prime target especially for establishment candidates like John Kasich and Chris Christie who are banking on New Hampshire.

GOV. CHRIS CHRISTIE (R-NJ), PRESIDENTIAL CANDIDATE: Let's get the boy in the bubble out of the bubble and let's see him play for the next week in New Hampshire. I'm ready to play. I hope he is.

(END VIDEOTAPE)

MURRAY: Now, Wolf, we are expecting Donald Trump to take some questions from reporters before he starts his event tonight, so we will get a better sense from him of what he thinks went wrong in Iowa and if he plans to do anything different here in New Hampshire to ensure that he can finally notch a victory -- Wolf.

BLITZER: We will have live coverage of that news conference from Donald Trump. All right, thanks very much, Sara.

Let's go to CNN's Sunlen Serfaty. She's also in New Hampshire right now with the Cruz campaign.

Sunlen, Ted Cruz hoping to parlay his Iowa victory to overtake Trump in next Tuesday's primary in New Hampshire. What's the latest there?

[18:05:03]

SUNLEN SERFATY, CNN NATIONAL CORRESPONDENT: That's right, Wolf.

Well, he is trying, but I think there's a very real awareness within the Cruz campaign that this is a much tougher state for Ted Cruz. New Hampshire voters much different than Iowa voters, fewer evangelicals, more moderate Republicans, more independents. All of that works against Ted Cruz, but still the campaign sending big signals that they're trying to dig in here in New Hampshire, potentially try to ride a little post-Iowa wave of momentum.

Ted Cruz had a big event here at a church. It was an absolutely packed house. He really came in with a fresh sense of energy and urgency. Although he is in South Carolina right now, for the rest of the week he will exclusively dig in here, and he will camp out for the next seven days, hold at least 16 events.

The Cruz campaign says they probably won't win here. What they're running right now is to exceed expectations. The goal, Wolf, is really to make a strong showing, close the gap and then look ahead and go on to South Carolina, where they feel much better -- Wolf.

BLITZER: All right, Sunlen, thanks. We will get back to you, Sunlen Serfaty reporting.

As we stand by to hear directly from Donald Trump, let's talk to one of his key supporters.

Scottie Hughes is a Tea Party leader, chief political correspondent for USA Radio Networks.

Scottie, thanks very much for joining us.

Back in 2013, Donald Trump tweeted this. He tweeted: "No one remembers who came in second," quoting the pro golfer Walter Hagen. How much of a setback was his second-place finish in Iowa?

SCOTTIE NELL HUGHES, USA RADIO NETWORKS: Well, of course, Mr. Trump would have liked to have finished first. Who wouldn't?

But this is -- we have to remember, 45,427 people took a vote in support of Donald Trump in Iowa. That is an incredible number, and probably more than ever before for any presidential candidate, except for Ted Cruz, who has 6,000 more. But that does not negate the strides that Mr. Trump made in Iowa.

Now he goes on to the Rust Belt, where he know he's most popular. His issue, immigration, is probably one of the key issues in New Hampshire right now that they're dealing with that voters appreciate. So, if he goes back on task, which he will and he is, talking about immigration, talking about securing our border, talking about bringing good jobs to the United States, especially a state like New Hampshire, I promise you're going to see that he's -- Iowa is going to be loved, but it's going to be a distant memory real quick.

BLITZER: Because, as you know, the central theme of Donald Trump's campaign is based on him being a winner. He said he wants to win so much, he will win so much. People will get sick and tired, remember he once said, of him winning.

But this is a man who clearly enjoys success, so where does he go now? This is awkward for him, coming in second, I suspect.

HUGHES: I don't know if it's necessarily awkward. Like I said, it's not ideal, but at the same time, this might have actually been a great chance for him to sit here and just see what campaigning is about.

Remember, Donald Trump is not a politician. He's never been on the campaign trail before. He's never done debates like this. And he's never had to actually work within the grassroots people that he's luring. I believe going into this next week, you're going to see a very active Mr. Trump within the grassroots, both working with the people on local radio, within events, and I think this is going to be a great prep for him as he gets ready for South Carolina and here down South, where people are really going to want to get to meet Mr. Trump, the man, not necessarily the legend.

BLITZER: Was his decision to skip that Republican presidential debate in Iowa a mistake?

HUGHES: Well, I don't think so.

I know there's $6 million that are going to go some really good vets. And that's something that you're seeing right now, is that money is being distributed. It's not just sitting in a foundation. We're seeing people actually being able to utilize the money. The question is -- that's just a what if. How do we know how he would have handled the debate?

We knew that there was going to be a lot of gotcha. It wasn't necessarily going into winning situation for him. And he's smart. He showed that he had leadership. He's not afraid to stand up for himself, which is exactly what the American people want right now. We want someone who's not afraid to stand up, even if it means you might get a couple hits. In the long term, that's exactly the quality we need.

BLITZER: Scottie, did last night's results demonstrate that Donald Trump maybe should rethink his strategy, embrace being more of a traditional candidate?

HUGHES: Well, I don't know about traditional, because a lot of those traditional candidates that won Iowa, which that's the majority of them, don't go on to win the nomination. Ronald Reagan himself did not do the Iowa debate. He did not win Iowa, but went on to be one of the best Republican presidents that we have ever had.

I don't know necessarily if he needs to judge or change his campaign based off -- now, going into New Hampshire, he's 20 to 25 points ahead in most polls. Nationally, he's still light years ahead of the other polls. We will see if that changes. I think it's all in how he handles the next few days and shows that he's right on task, right on message of securing our border and helping our economy.

BLITZER: He's about to answer reporters' questions. We're going to have coverage of that, Scottie. And then he's going to have a speech at a rally there in New Hampshire. Are we going to see more of the same? Or do you think today there will be a little different Donald Trump up there?

HUGHES: I think it's going to be back on task, going to be back in point.

Let's look at this. Let's put this in perspective of Iowa. Yesterday, Kim Kardashian held a poll about a new album label, and 389,000 people voted in that. That's more than both of the parties' Iowa caucuses combined.

[18:10:09]

I think it's really, really scary for anybody or any pundit that wants to base a change of their campaign just because of one state's nomination, especially the first one, that we knew might not necessarily be in Mr. Trump's favor.

BLITZER: You're totally confident he will win New Hampshire?

HUGHES: I -- if he continues on task and gets on message, which I think that's exactly what he's focused on doing, absolutely.

BLITZER: What about South Carolina, which follows?

HUGHES: Now, South Carolina is going to be a little bit more of a trying state. You're coming down South. Yesterday we saw Rick Scott endorse Marco Rubio. He's very popular.

But you have also seen the other governor come out and endorse Jeb Bush. This is going to be an interesting contest. But Mr. Trump is still leading in South Carolina. But the key is, he's going to have to continue to relate to the people both in South Carolina and beyond.

That's not by sitting there and just going on stage. I think that's one thing the Trump team is learning is how especially to relate. Just like Ted Cruz had a great ground game, watch out. You know when the Trump people start getting involved, they do the best.

BLITZER: All right, Scottie, stand by. We have more questions.

Once again, we're awaiting Donald Trump. He's about to hold a news conference with reporters in New Hampshire. Let's see how he does. Let's see what he says.

Much more right after this.

(COMMERCIAL BREAK)

[18:15:38]

BLITZER: We're standing by to hear directly from Donald Trump. He's campaigning in New Hampshire tonight fresh from his second-place finish in Iowa to Ted Cruz. Trump's event getting under way shortly. We expect to hear him at a news conference answering reporters' questions momentarily. We will have coverage of that.

In the meantime, we're back with Trump supporter, the Tea Party leader Scottie Hughes. She's also chief political correspondent for USA Radio Networks.

Scottie, Trump last night said that Cruz's victory last night was a Howard Dean moment, calling Cruz's speech rambling, overly flamboyant. Rubio says Iowa is just the beginning for him. How is Donald Trump going to deal with the very strong competition coming now from both Cruz and Rubio?

HUGHES: Well, he's always had them as competition.

I think he's going to continue to be the diplomat he is and rise above it, like we have seen him do many times on the debate stage. That's not saying he's always going to stay above the fray. And he is human. However, I think Cruz and Rubio right now need to be more worried about the other candidates.

You know, we sit here and we are talking about these three candidates, but we are forgetting that some of these candidates literally backhanded Iowa and ignored them these past few days, especially last night, and went on and hosted events in New Hampshire or have gone on to South Carolina.

What about those candidates right now? Those guys are going to be the ones that, as your reporter spoke about earlier, that are sharpening their pitchforks for Marco Rubio, as well as Ted Cruz. The question is, since both of those guys have to rely on donors and big PAC dollars, are their puppet strings going to be pulled in regards to how they respond and who they actually go after?

We have already heard pushback from Jeb Bush donors saying, please don't sit there and go after Marco Rubio, he might be our guy if you get taken out. That's going to be an interest dynamic, as we see not necessarily support shift, but more importantly the dollars shift behind a game, a game that Donald Trump doesn't have to worry about.

Kevin, what does Trump need to do over this next week to make sure he wins, that the polls are real, that he wins on the real poll next Tuesday in New Hampshire?

KEVIN MADDEN, CNN CONTRIBUTOR: He needs to slow the momentum of Marco Rubio, who kind of slungshot out of Iowa with a lot of momentum, and also slow the momentum of Ted Cruz as well.

The other thing he has to do is, he has to sort of shift his message. The immigration issue, while a very big one with a lot of Republican voters, is not as animating an issue in New Hampshire. He is going to have to start focusing more on the economy and national security.

The problem for that, those are two issues that are very good, very strong issues with Ted Cruz and Marco Rubio.

BLITZER: You think he's got to really go negative even more so, Donald Trump, against Rubio and Cruz?

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: I think he will continue to go negative on Cruz, and I think he will take some shots at Marco Rubio on immigration, even though immigration isn't the issue it is in Iowa.

It's still a very salient issue, because he can say the same thing about Marco Rubio as he can say about Ted Cruz, which is that they have both been on all sides of that issue. So he can sort of get them both with the same slingshot there. So, I think he...

BLITZER: Is he going to continue the Canadian birth issue? Is he going to continue the Goldman Sachs, Citibank...

MADDEN: There are a lot of Canadians in New Hampshire. He's got to be careful.

BORGER: There are. And if you look at the entrance polls, though, that birth issue didn't seem to have as much salience as it might have seemed when we looked at those polls. The issues that really worked for him in Iowa were immigration and the

jobs and the economy. And to your point, he will be talking about that.

(CROSSTALK)

MADDEN: And real quick, very conservative voters aren't the ones that Donald Trump can appeal to. He's going to have to appeal to more independent or somewhat conservative voters there.

BORGER: Exactly.

BLITZER: Mark Preston, you study the polls very, very closely. They seem to have gotten the results pretty wrong in Iowa.

One is the polls were taking a snapshot in time of the race. But let's just bring the Trump factor in to this. Having several thousand people show up at a rally for Donald Trump, we didn't know how to interpret that. Were these folks coming out for the spectacle, for the reality show part of it, or were they really going to be supporters?

[18:20:05]

And for those supporters, were they going to show up on a Monday night for Donald Trump? In addition to that, as much as we were told over and over and over again, and I have been told this for months and months and months, that Ted Cruz had this great ground game in action, the media, we failed to acknowledge that.

And Ted Cruz really put a grassroots organization on the ground in Iowa. And that's why we saw that on the polls. Wolf, if you look at the entrance polls going in, 35 percent of voters didn't make up their mind until the last minute. Really hard to capture the state of the race on that case.

BLITZER: Good point.

Ron, you have also broken down the entrance polls from last night. What's the takeaway that you get the most, specifically amongst evangelical Christians, the group Cruz clearly was courting very aggressively, and non-evangelicals?

RON BROWNSTEIN, CNN SENIOR POLITICAL ANALYST: The crack CNN polling unit broke down some numbers for me overnight that I think really pinpoint something very important about what happened in Iowa and what could have reverberations all way through the race.

We all know that from the beginning in both the state and the national polls Donald Trump's core strength has been his big support among working-class white voters, Republicans without a college degree. In the polling that earlier showed him ahead in Iowa, that supports was extending across religious lines. He was also leading among evangelical voters without a college degree.

And what we saw last night was very different. If you look at evangelicals without a college degree, Donald Trump was pushed back well behind Ted Cruz. And that suggests that the Cruz ads criticizing him on social issues had an effect. And what you came out of Iowa with, Wolf, I think was a fascinating potential for a three-way race.

You have Cruz dominating those evangelical voters with and without college degrees, you have Trump still strong among those blue-collar voters who are not evangelicals, and then I think, most fascinating of all, you had Marco Rubio finishing first among college voters who were not evangelicals. And that is the group that has usually picked the Republican nominee, those more white-collar, more secular, economic- focused voters.

They are the biggest single bloc in New Hampshire and it will be interesting to see if he can consolidate them against what will be more competition from John Kasich, Chris Christie and Jeb Bush. But you saw three distinct lanes emerging in Iowa in the demographics of the support.

BLITZER: Kevin, how does Rubio capitalize on the momentum he certainly got from Iowa?

MADDEN: Look, there is an emerging anybody but Trump caucus out there.

And I think one of the things that Marco Rubio has a chance to do now is consolidate support amongst those voters. I think the way to do that, and to Ron's point, there are a lot of fiscal pragmatists in New Hampshire, but there are also a lot of people who take this process very seriously, and believe electability is an important part of this.

So, if Marco Rubio can appeal to those fiscal pragmatists who want a candidate that they believe can win in November, that's how he consolidates that part of the -- that sliver of the electorate and takes Trump on in New Hampshire.

BLITZER: They say, Gloria, a week is a long time, almost lifetime in the world of politics. So, we know what the polls are now, but the next seven days, things could change.

(CROSSTALK)

Gloria Look, I think Marco Rubio has an awful lot of momentum heading into New Hampshire, a cliche, but true.

People are now going to give him a look in New Hampshire that didn't give him a look before. And so the problem for the three amigos, the three governors who have been sitting in New Hampshire, is that suddenly they have Marco Rubio in their lane, right?

And he's coming in with a good showing in Iowa behind him, and so voters there are going to take another look at him, particularly, to Kevin's point, if they're worried about electability.

BLITZER: Let me ask Ron Brownstein.

New Hampshire, is it do or die, let's say, for Jeb Bush, Christi Christie, John Kasich, some of these so-called establishment Republicans?

BROWNSTEIN: I think it is. I think whoever finishes first in that lane will be the one who has the best chance of going forward.

And to Gloria's point, it's really important here, Donald Trump has been leading in the polls in New Hampshire all the way through, but his numbers have always been very modest among these white-collar college-educated Republicans especially in New Hampshire. And the reason he's been ahead is because those voters have been fragmented among five or six choices.

If Rubio can consolidate those voters or any of the others can consolidate those voters, they can get a lot closer to Trump than it looks today. But so far, Trump has benefited from this division among the voters most resistant to him.

BLITZER: Mark Preston, Kasich seems to be doing really, according to the most recent polls, in New Hampshire. He seems to be moving up. He's a popular governor of Ohio. No Republican has ever been elected president without carrying Ohio.

You're there in New Hampshire. How's he doing?

PRESTON: Well, I got to tell you, I talked to the governor about three or four months ago.

And he said, listen, we're going all in, in New Hampshire, and none of you are picking that up. You're so focused on Donald Trump and the reality show aspect of this and you're talking about national polls. Why aren't you focusing in on New Hampshire?

Here's the deal with John Kasich. His type of politics does play well here in New Hampshire, very smart, talks about the economy. And, in fact, there was a very prominent Republican, no doubt, four years ago said to me, hey, where's that Kasich guy? Why isn't he running for president? I remember he wanted to run for president.

[18:25:01]

Well, guess what? Four years later, he is running for president and that's why Kasich is doing so well. But, look, we're coming into a knife fight on the streets here in New Hampshire. I know that sounds dramatic, but it's all on the line, not only for all these Republicans, but also for these Democrats between Hillary Clinton and Bernie Sanders.

We saw the temperature rise between these candidates over the last few days, but there's so much going on, Wolf, and there's so much acrimony between all these candidates, that I think that it's going to get very nasty in these closing days.

We're also awaiting Donald Trump. He's going to have a news conference, his first since his second-place finish in Iowa. We will take a quick break. We will be right back.

(COMMERCIAL BREAK)

BLITZER: Once again, we're awaiting Donald Trump at a news conference in Milford, New Hampshire. You're looking at live pictures. He'll go to the microphone, answer reporters' questions before he heads off to a rally.

[18:30:39] Meanwhile, Senator Bernie Sanders brought his campaign and his momentum to New Hampshire today, where polls show him holding a substantial lead over Hillary Clinton.

Our senior Washington correspondent, Joe Johns, is following the Democratic campaign, joining us from Keen, New Hampshire, right now.

So Joe, a lot of people say it's all about the expectations game. What's the latest?

JOE JOHNS, CNN SENIOR WASHINGTON CORRESPONDENT: well, Wolf, it was a very, very narrow victory for Hillary Clinton, just a photo finish, but a far cry from the disappointing loss she suffered in the Iowa caucuses eight years ago.

The Bernie Sanders campaign was very quick to point out that this victory for the former secretary of state was anything was decisive.

(BEGIN VIDEOTAPE)

HILLARY CLINTON (D), PRESIDENTIAL CANDIDATE: I am so thrilled that I'm coming to New Hampshire after winning Iowa.

JOHNS (voice-over): Hillary Clinton riding high tonight after narrowly edging out Bernie Sanders by fractions of a percent in the Iowa caucuses.

JOHNS: The contest was the closest in Iowa Democratic caucus history. A race with a margin so razor-thin the winner could not be determined until hours ago, when the Iowa Democratic Party released final numbers. Tonight, when asked if he was prepared to concede the Iowa caucuses to Hillary Clinton, Sanders was noncommittal.

SEN. BERNIE SANDERS (I-VT), DEMOCRATIC PRESIDENTIAL CANDIDATE: It may be the case that some delegates were selected based on a flip of a coin. Not the best way to do democracy.

JOHNS: Sanders says the fight for the Democratic nomination is just getting started.

SANDERS: It looks like we are in a virtual tie. Last night we began the political revolution not just in Iowa, not

just in New Hampshire, but all over this country.

JOHNS: And Clinton believes the victory will help set her campaign on a course for the Democratic nomination.

CLINTON: What a night, an unbelievable night? What a great campaign.

JOHNS: Underscoring her message in an interview with Wolf today.

CLINTON: I think that Democratic voters and other Americans want to know, what are the principle differences between me and my friend and opponent Senator Sanders?

JOHNS: Now, with New Hampshire's primary just one week away, both campaigns are brimming with confidence, Clinton claiming her Iowa win will boost her campaign's enthusiasm.

CLINTON: I've won, and I've lost there. It's a lot better to win. And we're bringing all that energy, all that excitement, all that determination right here to New Hampshire.

JOHNS: And Sanders saying he will defeat Clinton in New Hampshire.

SANDERS: As you know, we just got in from Iowa where we astounded the world. And now in New Hampshire, we're going to astound the world again.

(END VIDEOTAPE)

JOHNS: And Sanders at that media availability, after his appearance here in Keene, New Hampshire, came up with a snarky answer when he was asked to weigh in on Hillary Clinton's assertion that she's a progressive. He said, "Yes, except when she says she's a moderate" -- Wolf.

BLITZER: All right, Joe Johns, thanks very much.

I spoke with Hillary Clinton today soon after she was officially declared the winner of the Iowa Democratic caucuses. I asked her how she plans to distinguish herself from Bernie Sanders as the nominating contest moves forward.

(BEGIN VIDEOTAPE)

BLITZER: You described yourself in your speech last night as a progressive that gets things done. Are you suggesting Bernie Sanders, he may be a progressive, but he can't get things done?

CLINTON: I'm talking about my record. I'm talking about the Children's Health Insurance Program for 8 million kids. I'm talking about getting health care for National Guard members. I'm talking about helping to push through a treaty to lower nuclear weapons between us and the Russians when I was secretary of state. I'm talking about building the coalition against Iran to bring them to the negotiating table, and so many other issues. I have a very long record of getting results for people. That's what I care about.

You know, I'm all for laying out our ideology, talking about our ideas. I think that's great, and it gives you the direction that you want to head; but at the end of the day, what matters to me is that we move our country forward. We actually get more good jobs with rising incomes. We get equal pay for women. We actually begin to move toward early childhood education and paid family leave. And we are ready to really go into the rest of the 21st century with the kind of confidence and optimism that I think our country should be having.

[18:35:23] So I'm going to lay out my record, lay out my ideas. And Senator Sanders can certainly lay out his own. And we'll leave it up to the people of New Hampshire to decide what they think is the best choice for them and their families and the results they want to see for themselves and our country.

BLITZER: As you know, according to the entrance polls in Iowa, Bernie Sanders did a lot better than you did with younger voters: younger men and even younger women. Why do you think he's doing so well with younger voters out there?

CLINTON: I'm thrilled to see so many people get into the political process, and I was very proud of all the young people who worked for me, volunteered for me, supported me. That's all to the good, and it's great for the Democratic Party.

But I'm going to have some work to do to reach out to young voters, maybe first-time voters who have to make a tough decision as they evaluate who should be our president, our commander in chief, and I intend to do that.

BLITZER: As you know, Marco Rubio did rather well, coming in an impressive third place in the Iowa Republican caucuses just behind Donald Trump and Ted Cruz. Ted Cruz won Iowa.

What do you think about the possibility, if you do get the Democratic nomination, of running against Senator Rubio in a general election?

CLINTON: You know, Wolf, I'm not thinking that far ahead. My timeframe is next Tuesday and the primary in New Hampshire, and then I'll go on to the caucuses in Nevada and the primary at the end of the month in South Carolina, and then to the states that lie ahead.

I'm going to let the Republicans, you know, decide who their nominee will be. I will be prepared to run against and win, no matter who they nominate.

I think, as everybody is well aware, I'm pretty battle tested. It's important to have gone through this to know what the Republicans will do. They're already running $6 million of ads against me along with their, you know, Wall Street buddies, and so they know who they don't want to be the Democratic nominee.

And I take that as perversely flattering, because they also know that I mean what I say -- and I'll do what I have said -- to make sure that they don't ever wreck our economy again. So I'm going to take them on, as I have over the years, and then when I win, I will certainly reach out, work with them and find common ground wherever we can.

BLITZER: Madam Secretary, thanks very much for joining us. Congratulations on your win in Iowa.

CLINTON: Thank you so much, Wolf. Great to talk to you again.

(END VIDEOTAPE)

BLITZER: All right. Let's bring in our senior political commentator, the former Obama senior adviser, David Axelrod, along with the rest of our political experts who are still here with me.

David, you just heard Hillary Clinton say she's battle tested. How did Bernie Sanders perform, compared to Barack Obama's performance in 2008 in Iowa, where you were working for the then-senator from Illinois?

DAVID AXELROD, CNN SENIOR POLITICAL COMMENTATOR: Well, obviously, there were some similarities. First of all, we should point out that that was three-way race, and that skewed the numbers a little bit, but there were some similarities. Barack Obama beat Hillary Clinton about 6-1 among younger voters, and Senator Sanders did, as well.

One difference was, though, that I think it was the only time in the history of the caucuses in 2008 when the percentage of younger voters who participated, people under 30, equaled the number of voters who were over 65. Generally, the caucuses skew older. They did again on Monday.

And so he didn't do quite as well in engendering that kind of youth turnout. And part of it may have been the fact that kids were back in school, and they were off school when we were running in 2008. And part of it may have been that Obama was a new-generation candidate.

BLITZER: I'm sure all those are factors. Mark, you're there in New Hampshire for us right now. What are you hearing from your sources about this Democratic contest?

PRESTON: Well, Wolf, clearly it is going to get very personal very quick. Again, we talked about this just a short time ago. We saw Hillary Clinton and Bernie Sanders heading into the Iowa caucuses where the temperature was rising. Well, right now it is near a boil, and it is going to get worse.

Now, as we just heard Secretary Clinton say, she's going to talk about her ideals and her plan, but in addition to that, she really is going to, what I'm told now, try to bring into question the credibility of Bernie Sanders' ideas. They're lofty; they're idealistic in many ways, in their mind. And they're going to try to knock that down.

At the same, though, Bernie Sanders's campaign is going to hammer home the idea that they need to have bold initiatives. And as one of those top strategists said to me a short time ago, the Democratic Party doesn't nominate somebody who says, "We can't do something." It's rather somebody who says, "Why can't we do something?" Now, Wolf, long game right now for the Clinton campaign. They're

sending Bill Clinton down to South Carolina tomorrow to start to rally the troops down here. The Sanders folks tell me that Bernie Sanders, himself, as I would suspect Hillary Clinton will be spending all their time in New Hampshire in the next few days.

[18:40:15] BLITZER: Gloria, the White House press secretary, Josh Earnest, today said that a robust Democratic contest right now between these two Democratic candidates is actually good for the party.

BORGER: They're thrilled.

BLITZER: Well, is it good for the party?

BORGER: Well, look, I think that it's clear, from hearing the president, himself, if it were up to Barack Obama, Hillary -- his legacy depends on Hillary Clinton getting elected president of the United States. Period. End of story.

And that's why he had to meet with Bernie Sanders to kind of, you know, assuage his ire, you know, you know, the fact that he said that.

But, look, I think that, yes, contests are very good, but if I'm in the Clinton campaign right now, what I'm looking at is, yes, we're sending Bill Clinton to the south. We think we got a southern firewall and all the rest.

But what I'm looking at, as you head toward the general election, you see these early warning signs in these entrance polls from Iowa Democrats last night. You know, honest and trustworthy, Bernie Sanders beat her 8-1. "Cares about people like me," Bernie Sanders beat her 3-1. Young women, Bernie Sanders was much more popular among young women. So they understand that they've got -- they've got their work cut out.

BLITZER: You think Joe Biden regrets not jumping into this race?

BORGER: Every day.

BLITZER: You think he does?

BORGER: I think he does. I don't think he wakes up any day without regretting that he -- that he didn't get into this race. But as he said, time and time again, this wasn't the right time for him or his family and, again, a very late start due to the death of his son.

BLITZER: Ron Brownstein, what's the motivation behind Senator Sanders now and his campaign staff, still raising some questions about the results in Iowa?

BROWNSTEIN: Well, I mean, look, I mean, we saw four years ago with the Santorum/Romney situation, there's a lot of momentum that comes from winning. And I think if Bernie Sanders would be able to claim winning Iowa, it would have been a great thing for him.

Iowa, I think, did answer two big questions for the Sanders campaign, and it left two, on the other hand, still to be answered. Two things that Iowa did show us is that he can translate the enormous enthusiasm of those campus rallies into actual votes. Yes, the share went down from 22 to 18 percent of the vote cast by young people, but as David pointed out, he won them six to one. That is a big advantage.

The other thing he did in Iowa, Wolf, is he expanded beyond where he started. I mean, he started as that classic one-track candidate, relying almost entirely on those young voters and white-collar whites. And he ran even with Hillary Clinton among whites without a college education, those working-class whites that preferred Clinton over Obama by 2-1 in '08.

But Sanders did not do two other things, and that's really important. The biggest one is we're talking about. He did not show that he could break into minority voters. That's going to be very important very quickly in Nevada and South Carolina.

And the last one that doesn't get enough attention is, even though they ran into a dead heat, she beat him by almost 20 points among self-identified Democrats. He's depending largely on independents, and he's going to have to expand beyond that beachhead, too, to take this all the way to June as they're talking about.

Coming up, pressuring Putin. President Obama seeks to reassure nervous European allies with new troops and new equipment on Russia's doorstep. Will it work, or will it simply increase tensions in the region?

Plus, a young girl is found dead just days after going missing. Today, two college students from the girl's hometown are charged in connection with her death.

Also, we're awaiting Donald Trump, you're looking at live pictures. He's also to go to that microphone over there, answer reporters' questions for the first time since coming in second in Iowa.

(COMMERCIAL BREAK)

[18:48:30] BLITZER: Once again, we're awaiting Donald Trump. There you see the microphone -- he's about to go into that room, take questions from reporters. We'll stand by for that.

In the meantime, there's other important news we're following.

Recent aggression by the Russian President Vladimir Putin is prompting a wave of anxiety throughout American allies in Europe. And now, President Obama is trying to calm those nerves with several new assurances and a lot of extra money. Brian Todd is here in THE SITUATION ROOM. He's got more on the

developing story.

So, what is the president promising, Brian?

BRIAN TODD, CNN CORRESPONDENT: Wolf, tonight, he's promising them a lot more firepower right on their own territory. It's going to mean more American troops moving right near Vladimir Putin's borders and it will likely mean the Russian president will feel the heat and probably respond with aggressive moves of his own.

(BEGIN VIDEOTAPE)

TODD (voice-over): It is an ominous show of force and an unmistakable signal by the U.S. to Vladimir Putin. Tonight, the White House says it wants to quadruple the money it spends on its forces in Europe. A move that could ramp up tensions between America and Russia which U.S. commanders view as a top threat to national $ security.

TODD: Analysts say that approach means the Pentagon is likely sending many more heavy weapons, armored vehicles and other equipment to its NATO allies in Central and Eastern Europe.

EVELYN FARKAS, FORMER DEPUTY ASSISTANT DEFENSE SECRETARY: I can't underscore how big a deal it is because it's not just the equipment going in there being prepositioned, but also the people will be there -- again, rotating through on a regular basis. And it's about 5,000 troops.

[18:50:01] TODD: U.S. officials say the added weapons will ensure America has a combat brigade, always ready to deploy in Eastern Europe, even though Putin's been quiet along his borders with his chief NATO rivals, analysts see the latest U.S. moves as a way to counter Putin's previous aggression in Ukraine. His deployment of naval forces, including submarines near his rivals, even using his air force to buzz this American carrier, in what some call a Cold War- style cat-and-mouse.

JOHN HERBST, FORMER U.S. AMBASSADOR TO UKRAINE: Mr. Putin believes Western leaders are weak. He believes that by intimidation, he can persuade Western dealers to adopt a softer course in response to his aggression in Ukraine and perhaps elsewhere.

TODD: But if America is going to counter that aggression with a heavy show of force near Putin's western flank, experts say, there are risks, including the possibility of more Putin saber-rattling.

I want to go back to New Hampshire right now. Donald Trump is at that news conference, introduced by Scott Brown, the former senator from New Hampshire, from Massachusetts, but he now lives in New Hampshire. He was elected as a senator from New Hampshire. But he's endorsing Donald Trump right now.

Let's listen in.

SCOTT BROWN: The dysfunction in Washington, the fact that they don't talk, they don't work together. Very rarely does anything get done. And the one person who has the independence, and can be the change agent to actually get Washington working again, it was very clear to me that that was Donald Trump.

In addition, when you're looking at somebody who's actually had the opportunity to create jobs, who actually has had a real job in the private sector, who's actually signed the front of a check, and not just the back of a check, somebody who can actually bring people together, put the men in the room, shut the door, and actually negotiate some type of arrangement or settlement or conclusion to a very important matter affecting our country, whether it be dealing with our national security, our economic security, cybersecurity, you name it, and once again, it came back to Donald Trump.

So, that being said, I'm going to make a presentation obviously here tonight. It's something that's very important to me. I take it very, very seriously and do not take my endorsements lightly.

And I'm honored to give it to Mr. Trump, so congratulations and good luck the rest of the ride.

TRUMP: Never said that. That's not a statement I would have made, no. I've had a great relationship with Iowa.

I don't really think -- look, what happened is we had 17 candidates originally. I was expected to come in like anywhere -- maybe 10, 11, 12, 13. I ended up coming in second. Didn't devote tremendous time to it. Didn't devote tremendous money to it.

In fact, I guess in terms of money per vote, I'm about at the bottom. Meaning the most efficient. I came in second. I came in a strong second. Third was quite a bit away. I think 2,500 or something, close to 3,000 votes away. That's a big difference between second and third.

I think that we did really well. You know, as far as that's concerned. I think the press -- some of the press said I did fantastically well. Some of the press doesn't want to give it credit.

I think that we did very well. I didn't expect to do so well. I guess what did happen is one poll came out that we were four or five points ahead and that maybe built up a false expectation for some people. But if you would have taken me back to June 16th, I was told, don't even go to Iowa. Start right here in New Hampshire. Don't waste your time going to Iowa.

I went, I bonded with the people, bonded with evangelicals. We did really fantastically and came very close to winning. I mean, we came very close to winning. We came in second place.

So I am very happy with what happened in Iowa. You know, we had 17 people, and I was second. Now if you break it down, I guess you have 11 people, and I was second. And I think we did a very good job.

Yes, Tom?

REPORTER: (INAUDIBLE)

TRUMP: No, I don't think I feel any pressure. We're just going to do what I have to do. And if it works out, Tom, that's great. And if it doesn't, that's OK, too, because, you know, I'm here to do one thing, the theme, make America great again. I'm going to do it.

And I think we did very well. And I think I really -- I think we did really well in just about everything we've done running for office. I think we had a very good result yesterday.

Could have been a little bit better. Could have been one notch better. But it's interesting, all of these governors and senators that you have way down the list, 1 percent, 2 percent, you know, in terms of what happened, what just happened.

You know, I think the result was quite good. Especially for the amount of time I spent and for the amount of money I spent.

REPORTER: (INAUDIBLE)

TRUMP: Well, I think I have -- I think it fits me better. It probably suits me better. I've done very well in New Hampshire. I've been here a lot more. I have very good relationships with the people of New Hampshire. But I've had very good relationships with pretty much everybody.

SARA MURRAY, CNN POLITICAL REPORTER: (INAUDIBLE) Marco Rubio had a stronger than expected running in Iowa. Do you worry that that could eat into your lead here in New Hampshire? TRUMP: I really don't. I don't see that happening. I don't know

what's going to happen. You don't know but he does. I mean, we'll see what -- you have many, many people that aren't doing very well.

I am doing very well. But you have many, many people that are here, that are well-known politicians, they're governors and they're senators. But they're not doing very well. And they just came back from, you know, a very major defeat yesterday.

And mine wasn't. Mine -- it's very interesting. If you look at the numbers from yesterday, I got the highest number in history outside of the one number, in the history of the primary.

MURRAY: You brought in a lot of new caucusgoers.

TRUMP: I brought in also, I guess they had 185,000 people, which is 45,000 or 50,000 people more than they ever had.

MURRAY: And in New Hampshire, people would expect you to bring in more independents.

TRUMP: I think we will.

MURRAY: But also that they might be interested in Bernie Sanders. Have you thought about how you would pick off the voters who might be split between you two?

TRUMP: No, I think we'll get a lot of Sanders voters. They're very much into the trade world. And I'm the best on trade. He mentions it, Sara, but I don't think he does -- I don't think he's going to be capable of doing anything about it.

No, I think we're going to do very well here. I look forward to it.

(CROSSTALK)

TRUMP: Say it?

REPORTER: (INAUDIBLE)

TRUMP: We have a lot of events scheduled, yes. Well, we do. We have one commitment long-term for Arkansas, actually, where we'll have about 10,000 people. But we're going to be back and forth very quickly. We have a lot of events scheduled here.

REPORTER: Mr. Trump, your --

REPORTER: (INAUDIBLE)

TRUMP: Well, I just think -- I'm just happy with the way we're doing. I mean, we've bonded with the people, whether it's there or here. It's just a big bonding process going on.

If you look at South Carolina, it's the same thing. I mean, we're doing really well there. But we've devoted much more time here, and South Carolina. It's not a question of learning. I mean, I just want to continue to

do well. Our theme, the theme is so important, it's just make America great again. That's what we're going to do. That's what we're going to do. Not really a question of learning.

REPORTER: (INAUDIBLE) after suffering a defeat in Iowa?

TRUMP: If you look at the second place, people didn't talk about my second place. They didn't talk about it as positively as they should have. And yet, with Marco, who was more than 2,000 votes behind me, that's a lot of votes, by the way, they said, oh, he's surging, he's surging.

So, I don't know why is the third place person doing well -- and second-place person who by the way has never run -- Scott mentioning before, he said, one of the amazing things about you, you've never run for office before. It's incredible how you do it because you've never done --

REPORTER: What about your brand as a winner?

TRUMP: I think my brand's doing great. Yes, I think it's doing great.

REPORTER: (INAUDIBLE) what will you do to maintain that lead and will you be doing differently (INAUDIBLE)?

TRUMP: No, I think just work. We're going to work very hard. We have a lot of meetings, a lot of talks, a lot of speeches. We're going to be meeting with a lot of people. And I think we're going to do very well.

REPORTER: Retail politics, talking to voters.

TRUMP: We'll be doing some of that. But we also have some very big events planned. Like, tonight, I think they have 4,000, 5,000 people. And other people were here yesterday. They had 200 people, same venue, same everything, they have 200 people. So we have -- it's a good bonding going on.

Yes?

REPORTER: Mr. Trump --

REPORTER: (IANUDIBLE)

TRUMP: Well, I enjoyed it.

REPORTER: (IANUDIBLE)

TRUMP: I have unlimited. I have unlimited. It's funny, when I look at the various people, they say so-and-so has $20 million. I have unlimited. That's not the thing.

Of course, I want to spend wisely, and I'm probably $40 million under- budget because of the fact, frankly, I haven't had to spend very much. Although I guess we just did a recent filing and I would probably have spent now $14 million, $15 million.

But I'm self-funding. And I must tell you, I don't know that enough people appreciate it, I'm self-funding anyway whether they appreciate it or not. So I won't be influenced by the lobbyists and, you know, et cetera, et cetera.